India stocks sink to two-year low

International financial turbulence is hitting Indian shares

Indian stocks have slumped to a two-year low on the back of fears that the global financial crisis will lead to world recession.

Shares on the Bombay Sensex exchange sank 606.14 points, or 5.7%, to close at 9975.35.

It is the first time since June 2006 the exchange has fallen below 10,000.

Correspondents say that the global slowdown and the weaknesses of the US economy have directly affected India, where investors are in "panic mode".

Indian shares have lost nearly 50% of their value this year.